Interval Funds & Non-Traded Structures
An interval fund is a closed-end fund registered under the Investment Company Act of 1940 that offers its shares continuously at net asset value and repurchases them only at set intervals, most often 5 percent of outstanding shares each quarter under Rule 23c-3. The structure lets a fund hold private credit, real estate and other illiquid assets while giving investors a scheduled, capped exit at NAV rather than a daily one.
How the structure works: daily or periodic NAV, continuous subscriptions, a board-approved repurchase offer every three, six or twelve months for 5 to 25 percent of shares, and pro rata allocation when requests exceed the offer.
What it is not: a mutual fund (no daily redemption), a listed closed-end fund (no exchange price or discount), or a private fund (no accreditation requirement, 1099 reporting, a board with independent directors).
Liquidity & Redemption Mechanics
Tender offers, redemption windows, gates, and share repurchase programs defining interval fund liquidity.
Tender Offer Mechanics
Quarterly and annual repurchase structures—pricing at NAV, proration calculations, and settlement timelines.
Tender Proration
How limited repurchase capacity is allocated when investor redemption requests exceed the offer size.
Liquidity Windows
Timing and frequency of redemption periods—quarterly versus annual windows and investor notification requirements.
Redemption Gates
5-25% repurchase limits and suspension triggers—board discretion and shareholder protection mechanisms.
Share Repurchase Programs
NAV-based buyback mechanics—equal treatment rules, fulfillment priority, and proration formulas.
Valuation & Pricing Methodologies
NAV calculation frameworks, illiquid asset valuation, and stale pricing dynamics in quarterly-marked portfolios.
NAV Pricing Methodologies
Fair value hierarchy for interval funds—Level 1-3 asset classifications and third-party valuation oversight.
Illiquid Asset Valuation
Private credit, real estate, and venture capital appraisal processes—DCF models and quarterly marking cycles.
Stale Pricing Risk
Valuation lag in illiquid holdings—quarterly marking creating NAV arbitrage opportunities and investor implications.
Anti-Dilution Levy
Flow-cost adjustments that protect remaining shareholders from subscription and redemption costs.
Swing Pricing
Swing factor and threshold, full vs partial swing, the 2018 SEC rule and why US funds do not use it.
Structure & Compliance Frameworks
Fee structures, RIC qualification requirements, and investor suitability standards for interval fund operations.
Interval Fund Fee Structures
Management fees, performance fees, and 12b-1 distribution costs—share class variations and total expense analysis.
RIC Qualification Requirements
Regulated Investment Company tax status—diversification tests, income requirements, and distribution mandates.
Investor Suitability & Accreditation
Non-accredited investor access standards—investment minimums, concentration limits, and holding period expectations.
Semi-Liquid Fund
Fund wrappers offering periodic but limited liquidity for illiquid or private-market assets.
Tender Offer Fund
Discretionary quarterly repurchases under Rule 13e-4, the qualified-client performance fee link, and the Schedule TO record.
Interval Fund vs Tender Offer Fund
Mandatory Rule 23c-3 offers against board-discretion tenders, row by row: size, timing, reserve, NAV frequency, fees, eligibility.
Non-Traded REIT
NAV REITs, the 2% monthly and 5% quarterly repurchase cap, share classes and fees, Reg A vs registered, and distribution funding.
Leverage & Liquidity Risk
NAV facilities, margin dynamics, and forced selling pressures in leveraged interval structures.
NAV Facilities
Credit lines secured by fund NAV—leverage mechanics and margin call dynamics in interval funds.
Margin Call Dynamics
Forced collateral posting when NAV declines—creating liquidity spirals in leveraged interval structures.
Forced Seller Dynamics
How redemption pressures and regulatory constraints create non-economic selling in stressed markets.
Funding Horizon Mismatch
Quarterly redemptions funding illiquid assets—refinancing risk and forced deleveraging scenarios.
Risk Frameworks & Default Mechanics
Default triggers, covenant structures, and remediation frameworks in interval fund financing.
Structural & Legal Frameworks
SPV structures, share class mechanics, and legal frameworks enabling interval fund operations.
Cayman SPV Structures
Offshore structure mechanics—tax efficiency and regulatory arbitrage in interval fund formations.
Subordination Analysis
Share class priorities and liquidation waterfalls—understanding interval fund capital structure.
True Sale
Legal separation ensuring bankruptcy remoteness in multi-SPV interval fund structures.